We can also rule out LEC’s culture being detail-oriented since paying attention to individual customer preferences as the company’s leading competitive edge is not the case. At first glance, it might look like as though LEC is a people-oriented culture since fairness in equity is a top priority. Additionally, there are rewards and health care and a low turnover rate. However, on closer look it proves to be more of an outcome-oriented one. According to Carpenter, M., Taylor, B., Erdogan, B.
In this section, an evaluation tool is needed to analyse the positives and negatives of the business concept, to develop a competitive advantage and make it easier for the business concept to succeed in entering the market. Table 1: Strengths and weaknesses Strengths The products that the business sells and trades will be unique, authentic and differentiated as it isn’t sold on a mass scale and it is second-hand treasures which makes it attractive to consumers. This will also cater for many different customer fashion styles, it is not just the latest fashion trends and it does not just target a certain group – increasing its market
There are different reasons of introducing the loyalty programs by stores. Uncles (2003) proposed two aims of customer loyalty programs. First is making a better relationship between the store and customer. So this is beneficial to sustain the current customer base in good position. The second aim is to rise a revenue by increasing purchase levels.
Economy is partially related to efficiency as it also focuses on minimizing the cost of input of an organization. Economy is measured by looking at the cost of the resources an organization consumed and the value of the output they deliver. Tesco Seri Tanjung Pinang should know that economy is important for them as it can help them gain competitive advantage by offering their products with a lower price compared to other stores by lowering their costs. Since Tesco Seri Tanjung Pinang has an objective of offering at the most possible lowest price of their product to their customer, this element has become more important for them to implement because they want to minimize the input and maximize their output. Lastly, the effectiveness refers as to achieve goals by successfully delivering what they intended to.
These goods and services that are produced at a lower cost are not inferior goods they are comparable to other competitors. In Cost leadership strategy, a firm becomes a low-cost producer in its industry, has a broad scope, services many industries and may even operate in industries that are related to it (Porter 1985). Porters stated that firms with high market share are the ones which are profitable and these firms become successful because they pursue the cost leadership strategy. Some researchers have done some work on the statement by Porter and have made differentiations between cost leadership that is low cost strategies and best cost strategies(Tanwar 2013). They concluded that low cost strategy is not able to provide sustainability in an organisation in the long term and cannot provide a competitive advantage.
3) Concentrated Marketing A concentrated marketing (or niche marketing) strategy means that a company would concentrate its marketing efforts towards a large share of a small segment or a niche market. This method is usually used by smaller companies with fewer competitors, or by new comers to get a foothold against aggressive more resourceful competitors, and then develop into broader competitors. It can also be used by some megamarketers as markets change, to develop niche products and grow sales. This method allows a firm to achieve a strong market position while staying effective by fine-tuning its products, prices, and programs to the needs of its defined segments, and efficient as it targets only aconsumers in the niche market it is addressing through different promotion channels. However, there is a high risk of targeting just one niche market, as the business might suffer greatly if a larger competitor decides to target the same segment using its great resources, or if a substitute product enters the market with a lower price then the company would suffer tremendously; that’s why companies usually tend to diversify their products and
Successful business, as it is mentioned in the case study (Growing a Business byInternational Acquisition), Know when and how to adapt and change which involves growing some areas and cutting back less profitable areas. Companies may often grow by benefiting from acquiring businesses or outsourcing operations in overseas markets because of the availability of customers and low wages of the production cost. Business growth or expansion has potential benefit and drawbacks, thus some business owners are unwilling and hesitant to run the risks and face the challenges of growing their businesses so they choose to leave them at the level of sole proprietorship. However, Growing businesses have two main advantages over its smaller competitors: • They
Policy changes: In general firms, the attempt to implement a cost-leadership strategy will choose to produce relatively simple standardized products that sell for relatively low prices compared to the products and prices of firms pursuing other business or corporate strategies. • FIVE FORCES MODEL OF COST LEADERSHIP STRATEGY 1. Threat of Entry : If an existing firm is a cost leader, the new entrants in the market may have to invest heavily to reduce their costs prior to entry. Generally, new entrants will enter using other business strategies like differentiation, alliance etc. rather than attempting to compete on costs.
With this mode the firm has less control over it product and brand image, therefore it is important to choose partner with similar position. • Established marketplace: by selling 2.2.2 Competitive strategy According to Brandenburger and stuart (1996), “The essence of strategy lies in creating favourable asymmetries between a firm and its rivals” (p.804). A competitive strategy attempts to identify and secure the most promising market segment within a product-market area (Pearce & Robinson, 2003). To achieve a competitive advantage, customers must value a firm’s product or activity more than its competing firms (Hollensen, 2010). Lee & Lee (2011) described Porter’s generic strategies as a way for company to achieve competitive advantage.
Advertising is understood as the non-personal presentation and promotion of idea, goods and services by an identified sponsor. The objective of the advertising is to inform, persuade, remind and reinforce the market offering to the target consumers. The aim of the advertising is to create primary and the selective demand for the product. But the cost of advertising is high and may be a limiting factor for the small business. Publicity is understood as the non-personal promotion of ideas, goods and services which is not paid by the media owner.